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HYDERABAD: The Telangana agitation may have impeded the growth of many sectors in Andhra Pradesh over the past decade, but its effect on the information technology industry in the state has so far been minimal. It is business as usual for the sector as top IT companies, such as Amazon, Oracle, TCS and Infosys, go ahead with expansion plans.

Also, notwithstanding the political turmoil, cities like Visakhapatnam -- which is in the Seemandhra region of the bifurcated state -- have been showing impressive growth in the sector. Ponnala Lakshmaiah, state minister for IT and communications, said Hyderabad stays a favourite for IT investments.

"The agitations have not had any effect on IT firms," he said. Lakshmaiah said on the day of the "million march" for Telangana in March 2011, a US IT firm had set up operations in Hyderabad.

Global Players Watching

Similarly this June, during another protest march, a conclave for top IT honchos was held. But Pradeep Udhas, a partner at KPMG, said while IT companies have not been affected badly so far "international players are watching the political developments in the state."

The Telangana agitation first began in 1969, when people from the region alleged that promises made during the merger of Hyderabad state with Andhra were not honoured. It subsequently died down. But the protests for statehood to Telangana erupted once again about a decade back and increased in fury with each passing year.

This July, the United Progressive Alliance government at the Centre approved the creation of Telangana with 10 districts, including Hyderabad. Since then, there have been widespread protests in the Seemandhra region, parts of the state that will remain after Telangana has been carved out.

"Andhra Pradesh has the talent, infrastructure and a good ecosystem," said V Rajanna, president of the IT and ITeS Industry Association of Andhra Pradesh (ITsAP). "The industry has soared irrespective of the political issues in the state."

Also, the Cabinet Committee on Economic Affairs last month approved the establishment of India's first IT Investment Region (ITIR) in Hyderabad. The project, which is to be completed over 25 years in two phases, is likely to see investments of Rs 1.18 lakh crore in software and Rs 1.01 lakh crore in hardware, mostly through public-private partnerships.

"ITIR is a massive project and has good investment and employment prospects. However, it depends on how well and soon it is executed," said Rajanna. The IT industry earned total revenues of Rs 64,354 crore in fiscal 2013, compared with Rs 53,246 crore a year ago.

Much of the activity is centred around Hyderabad, which accounts for over 97% of the revenues and has about three lakh IT professionals.